Stock Story -
What Happened: Shares of semiconductor designer Lattice Semiconductor (NASDAQ:LSCC) fell 18.1% in the pre-market session after the company reported second-quarter earnings results. Its revenue and EPS both missed Wall Street's estimates. Looking ahead, guidance for next quarter's revenue also missed analysts' expectations.
The company called out industry headwinds, adding, "Second quarter 2024 results reflect the impact of cyclic industry headwinds. While the industry continues to go through a period of inventory normalization, we are starting to see signs of improvement. We continue to execute on our ongoing product portfolio expansion and remain well positioned for long-term growth."
Overall, this was a mediocre quarter for Lattice Semiconductor.
Following the results, Bank of America (NYSE:BAC) analyst downgraded the stock's rating from Neutral to Underperform, citing "slowing growth prospects and muted visibility."
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Lattice Semiconductor? Find out by reading the original article on StockStory, it's free.
What is the market telling us: Lattice Semiconductor's shares are somewhat volatile and over the last year have had 16 moves greater than 5%. But moves this big are very rare even for Lattice Semiconductor and that is indicating to us that this news had a significant impact on the market's perception of the business.
The biggest move we wrote about over the last year was about 2 months ago, when the stock dropped 15.4% on the news that the company announced that President and Chief Executive Officer Jim Anderson is stepping down to pursue new opportunities. Esam Elashmawi, Chief Marketing and Strategy Office replaced him as Interim Chief Executive Officer effective immediately.
An update from Coherent (NYSE: COHR), another semiconductor company, revealed that Jim Anderson will become its new Chief Executive Officer.
The market was likely unsettled by the sudden CEO exit as it created an air of uncertainty and the stock fell as a result.
Lattice Semiconductor is down 25.3% since the beginning of the year, and at $51.14 per share it is trading 47.4% below its 52-week high of $97.26 from August 2023. Investors who bought $1,000 worth of Lattice Semiconductor's shares 5 years ago would now be looking at an investment worth $3,112.
